The COVID-19 pandemic adversely impacted several small and micro businesses. You may have seen this first hand too, since many small shops or street vendors in the area you live in may have been forced to go out of business during these troubled times. Street vendors form a crucial part of the economy and supply chain in India. They make it easier for people to buy their everyday essentials such as groceries and provisions, and ensure that necessary services such as laundry, barber services, and more are available to everybody in the area.

With many street vendors going out of business during and due to the pandemic, the government saw that there was a pressing need to help these micro entrepreneurs kick start their businesses again. And this is why the PM Street Vendor's Atma Nirbhar Nidhi (PM SVANidhi Scheme) was launched by the Ministry of Housing and Urban Affairs on June 01, 2020. It ties into the government’s principle and vision of an Atmanirbhar Bharat.

What is the PM SVANidhi Scheme?

The PM SVANidhi Scheme was launched by the government to make working capital available to street vendors across the country. Under this scheme, eligible street vendors can avail of collateral-free loans at low rates of interest. The objectives of the PM SVANidhi scheme include the following -

• Provide working capital loans up to Rs 10,000 at a subsidized rate of interest
• Offering incentives to ensure regular repayment of the loans
• Rewarding digital transactions

What are the eligibility criteria for the PM SVANidhi Scheme?

The eligibility criteria under the PM SVANidhi Scheme are fairly simple. Any street vendor who was or has been engaged in business in urban areas of the country on or before March 24, 2020, can avail loans under this scheme, provided they satisfy the following criteria.

• The street vendor should possess the Certificate of Vending/Identity Card issued by Urban Local Bodies (ULBs)
• Any vendor who has been identified in the survey but has not been issued the Certificate of Vending/Identity Card must have a Provisional Certificate of Vending
• In case the street vendor has not been a part of the identification survey led by Urban Local Bodies or who have started their vending business after the completion of such a survey, they should have been issued a Letter of Recommendation (LoR) to that effect by the ULB or the Town Vending Committee (TVC)
• In case of a street vendor carrying on business in the surrounding development, peri-urban or rural areas, within the geographical limits of the ULBs, they should have been issued a Letter of Recommendation (LoR) to that effect by the ULB/TVC

How to apply for the PM SVANidhi Scheme?

Applying for the PM SVANidhi Scheme is easy. Eligible street vendors should approach a Banking Correspondent (BC) or an Agent of a Microfinance Institution (MFI) in their area of business. Then, they need to fill up the relevant application form and upload the necessary documents in through a mobile app or via the respective portals.

Check out the KYC documents required to apply for PM SVANidhi loans below:

• Certificate of vending or the ID card issued by ULBs or the Letter of Recommendation from ULB or TVC
• Any one of the identity proof documents - Aadhaar card, voter identity card, driving license, MNREGA card, or PAN card

What are the benefits of the PM SVANidhi Scheme?

Loans under the PM SVANidhi Scheme are very helpful for street vendors in India. It offers several benefits to the borrowers, as outlined below.

• Access to working capital loans up to Rs 10,000 with a repayment tenure of 1 year
• No collateral needed to avail the loan
• Vendors will be eligible for the next working capital loan with an enhanced limit once they repay the first loan
• Street vendors are eligible for an interest subsidy at the rate of 7 percent up to March 31, 2022
• Incentives for digital transactions in the form of monthly cashback ranging from Rs 50 to Rs 100